28 F1d 297

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BANKS AND BANKING-NATIONAL BANK-LIABILITY OF SHAREHOLDERS-AsSESS· MENT-TRANSFER OF STOCK.

When bank stock was sold, but not transferred on the books of the bank, and the bank afterwards failed, the executors of the person in whose name the stock stood on the books were held liable for assessment, although said stock had been paid for by a purchaser buying at the request of the president of the bank. who gave him a cashier's. check for that purpose, placing the money so furnished to the credit of said purchaser on the books of the bank as a temporary loan, the intention being ultimately to transfer said shares to a third party, as part of a larger proposed investment in stock, for which funds had been placed in the hands of the president of the bank. .

At Law. Ranney et Olark, for plaintiff. E. R. Hoar, for defendants. COLT, J. Under the agreed statement of facts, we think the defendants must be held liable for the assessment. The shares of stock were never transferred on the books of the bank, but stood in the name of Leonard Whitney, the defendants' testator, when the bank passed into the hands of the receiver. The defendants on November 12, 1881, sold the stock through a broker to one George R. Eager, and received payment for the same. Tile bank suspended November 18, 1881. It resumed business again March 18, 1882, and continued until May 20, 1882, when it failed, and a receiver was appointed. It was the duty of the defendants to have seen that the stock was transferred on the books of the bank. The by-laws provide that the stock shall be assignable only on the books of the bank, and that the certificates of stock shall state upon the face thereof that the stock is transferable only upon the books of the bank, and when transferred the certificates shall be returned and canceled. Eager bought this stock at the request of Benyon, president of the bank. Benyon had received $25,000 from Gov. Coburn, of Maine, for investment in the stock of the bank, and the 100 shltres sold by the defendants was intended to go to make up a part of this purchase. Eager, in payment for the stock, gave a check on the Pacific Bank, and Benyon had put to the credit of Eager, who was a depositor, from the funds of the bank, the exact a,mount required for the purchase of the stock. The money so furnished was carried to the credit of Eager as a temporary loan. Upon the filling of the whole order of Coburn, the design was then to have the stock transferred to him. Fifty shares more of stock were afterwards purchased towards filling Coburn's order. It further appears that the check on the Pacific Bank, which Eager gaye to the broker, would not be received as a deposit by the Eagle Bank, where the broker kept his account; whereupon Eager's clerk took the check

:198

FEDERAL REPORTER.

to Benyon, who gave a cashier's check of the Pacific Bank on the Eliot Bank for the amount, which was paid. Upon receipt of the cashier's check the broker deli vered to Benyon the two certificates of stocl" of 50 shares each, received from defendants a power of attorney in which the name of the attorney and date were left blank, and a certificate of the probate court of the appointment of defend· ants as executors. In the deposit account of Eager in the bank the check that he gave is entered as paid. The amount of money carried to the credit of Eager by Benyon, to meet the check, remained on the books of the bank as a temporary loan to the time of final failure. Upon this state of facts it is contended by the defendants that the purchase was really made for the bank with funds furnished directly by the bank, and that it then became the duty of the bank to have the legal transfer made, and that this court has power to correct the record, and treat that which ought to have been done as already done; and, further, that a national bank can acquire a good title to its own stock either as owner or pledgee, notwithstanding the prohibition of the statute; and that neither the bank itself, nor any party except the government, can set up the illegality of the purchase or pledge to eSl-lape any liability consequent on such ownership. Johnstonv.Laflin, 103 U. S. 800; National Bank of Xenia v. Stewart, 107 U. S. 676; S. O. 2 Sup. Ct. Rep. 778. But, upon the proof before uS,we oannot assent to the proposition that the bank was the purchaser, and therefore the reasoning of defendants' counsel is not applicable to this case. The bank never intended to buy this stock. It was purchased, in fact, for Gov. Coburn, and he had sent $25,000 to the bank for this purpose, which the bank was to hold on special deposit until the order was filled, when the whole stock was to be transferred to him. Under these circumstances it would seem immaterial whether the stock in question was paid for by Eager's check, or by the cashier's check given by Benyon. By loaning Eager the money, and subsequently debiting his account with the check, it is manifest that Benyon was not purchasing the stock for the bank, but intended, through Eager, to fill Coburn's order. This being a suit brought by the receiver, who represents the creditors, and it appearing that the stock was not transferred on the books of the company as provided by the by-laws, we think the defendants liable, and that judgment must be entered for plaintiff. Davis v. Society of 44: Conn. 582; Adderly v. Storm, 6 Hill, 624; Anderson v. Philadelphi.a Warehouse Co., 111 U. S. 479,483; S. C. 4 Sup. Ct. Rep. 525; Johnston v. Laflin, 103 U. S. 800, 804; Turnbull v. Payson, 95 U. S. 418; Brown v. Adams, 5 Biss. 181.

uxrnm

srATES V. SANDOUN.

299

UNITED STATES V. SANBORN.

(Circuit Court,

n. Massaclwsetts.

August 14. 1RS6.)

ANOTHER STATE--AMOUNT TAX'

1.

Under Rev. St. 848. the travel of an ordinary witneoo, I't.l.", without nl\,q jng been summoned, has traveled from and to the place of his residence, niore than 100 miles off, and in another state and district, should be taxed for the whole distance between his residence and the place of trial. 2. SAME-COMPENSATION OF GOVERNMENT CLERK-REV. ST. § 850. Under Rev. St. § 8GO, the necessary expellses of a government clerk sent away from his place of business as a witness for the government will be paid, but nothing can be taxed in the bill of costs for his travel or attendance.

WITNESS-COMPENSATION OF WITNESS AEI.E Fon TRAVET,-REV. ST. § 848.

Clerk's report of taxation of costs after judgment for the United States in an action at law brought by them for money had and received. The bill of costs submitted by the attorney for the United States included the following items, dnly certified, of sums paid to witnesses: First. For a witness who attended court without a subprena, four days' attendance, at $1.50 a day; and 416 miles travel from and to his residence, at Troy, in the state of New York, at 5 cents a mile,in all, $26.80. Second. For actual and necessary expenses in going, attending court, and returning, of four clerks,-two in the war department and two in the internal revenue office, at Washington, sent witnesses for the government,-in from their places of business all, $2HL20. . The defendant objecteu that no costs could be taxed against him for witnesses who attended without a subprena, save for the days when th,ey were present and testified; nor for travel of witnesses beyond 100 miles, and beyond the limits of the district in which 'be court was held; nor for any traveling or other expenses of witnesses in the employ of the United States. "In this district." as the clerk stated in his report, "a necessary and material witness has always been allowed, 'for each day's attendabce in court, one dollar and fifty cents, and five cents a mile for going from his place of residence to the place of trial or hearing, and five cents a mile for returning,' whether subprenaed or not, and whatever the distance may have been." The clerk followed this practice so far as to allow four days' attendance and 100 miles travel each way of the first witness, amounting in all to $16; but, in deference to what he supposed to be now the weight of authority, disallowed travel beyond 100 miles, and without the limits of the district. The clerk allowed a like amount for attendance and travel of each of the government clerks who testified as witnesses, and disallowed the amounts charged for their expenses. His reasons for this, as stated in his report, were that, under section 850 of the Revised Statutes, these clerks were entitled to be paid their necessary expenses by the